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A.M. Best Affirms Ratings of Heddington Insurance Limited CONTACTS:
FOR IMMEDIATE RELEASE OLDWICK, NEW JERSEY, U.S.A., July 12, 2010—A.M. Best Co. has affirmed the financial strength rating of A (Excellent) and issuer credit rating of “a+” of Heddington Insurance Limited (Bermuda). The outlook for both ratings is stable. The ratings reflect Heddington’s superior capitalization, consistently positive operating results and the role that it plays as a captive insurance company of Chevron Corporation (Chevron) [NYSE: CVX]. These positive rating factors are partially offset by Heddington’s high net loss exposures, as the coverages provided tend to result in claims that are characterized as low frequency but high severity. This is somewhat mitigated by the captive’s good loss history supported by very strong investment income and parental support on loans to affiliated companies. Heddington has sufficient resources to meet its underwriting related obligations, as measured by Best’s Capital Adequacy Ratio. The ratings are based on the consolidated results of Heddington and its subsidiary, Heddington Insurance (U.K.) Limited. The ratings further recognize the risk management programs and underwriting coordination in the design and implementation of insurance policies offered by Heddington, as well as the cost effective manner in which those services are delivered. Heddington also gains from Chevron’s global scope, which provides it with a favorable geographic distribution of risks assumed. In its role as a captive insurer, Heddington, along with Iron Horse Insurance Company (another active Chevron captive), currently provide broad and competitive global insurance products for Chevron and its subsidiaries. The insurance needs of Chevron are supplied through these captive operations where appropriate and the commercial market. Heddington and the other Chevron captives provide comprehensive coverage above Chevron’s internal retentions, while its reinsurance is placed through a corporate wide plan with the world’s significant providers of capacity, resulting in a diversified and balanced distribution of reinsurers. A.M. Best remains the leading rating agency of captive insurers rating a wide variety of more than 200 captives in the United States and throughout the world. For current Best’s Credit Ratings and independent data on the captive and alternative insurance market, please visit www.ambest.com/captive. The principal methodologies used in determining these ratings, including any additional methodologies and factors that may have been considered, can be found at www.ambest.com/ratings/methodology. Founded in 1899, A.M. Best Company is a global full-service credit rating organization dedicated to serving the financial and health care service industries, including insurance companies, banks, hospitals and health care system providers. For more information, visit www.ambest.com. ### |
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